Be Careful When Using Debit Cards to Buy Money Orders to Earn Miles

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In my experience, both of these cards earned miles when I experimented with buying money orders from different institutions as a PIN-based transaction.

To be clear – I do NOT recommend buying money orders and depositing it back into your bank account to earn miles. Such activity is easy to trace, and in large amounts will be reported to the government, and there are reports of folks getting their accounts closed for this abuse. Bank of America has blacklisted some folks from ALL of their products (bank accounts, loans etc.) including their credit cards which you may be able to get again (…and again).

Some of you will disregard this, but do so at your own risk.

But this could be a way to earn miles for genuine payments such as mortgage payments, student loan payments, or any payments where you write a check, but don’t earn miles and points. This isn’t a revolutionary idea and such thoughts have been around for years. Over the years, buying money orders with a debit card have earned miles and points, and sometimes they have not earned miles and points.

Terms & Conditions of the Debit Cards

Both debit cards appear to have restrictions in their terms and conditions against earning miles.

The card which earns Delta miles says (bolding mine):

Only PIN Point of Sale [POS] and signature-based purchases (including small dollar purchases that do not require a signature), Internet purchases, phone or mail order purchases or automatic bill payments qualify for mileage earnings. Cash advances, cash portion of a PIN POS sale with cash back, ATM transactions, payments for stored-value cards, wire transfers, money transfers, quasi cash, and traveler’s cheques do not qualify.

The card which earns Alaska Airline miles says (bolding mine):

We take the total amount of POS [point of sale] purchases for a calendar month and subtract any (a) credits related to POS purchases, (b) other adjustments to your deposit account related to POS purchases, (c) cash back from a POS transaction, (d) (d) quasicash transactions, which are transactions convertible to cash and include the purchase of money orders, travelers checks, foreign currency, cashier’s checks, gaming chips, and other similar instruments and things of value.

But in my experience – and I’ve done this for only ~$200 on each debit card – I have earned miles when I bought money orders at these establishments.

However, this could stop anytime since the terms and conditions are written to prevent earning miles for buying money orders. In addition, this is likely unprofitable for the banks involved, and I suspect the ability to earn miles for purchasing debit cards is on its way out.

Unfortunately, I haven’t been able to buy a money order with a credit card yet, but let us know in the comments if you’ve been able to.

Where Can You Buy Money Orders With a Debit Card?

In my experience, you can buy them at many places including:

The Worlds Largest Retailer. I went to the Money Center and bought money orders.

Certain Grocery Stores. I’ve personally verified this at the store below which is part of the largest grocery chain in the US. Some grocery stores refused to sell me money orders with a debit card, but each store has its own rules, so ask around.

In addition, most sellers of money orders will ask for identification and take down your social security number, driver’s license and other identifying information if you usually attempt to buy more than $3,000 in money orders at a time, and most will not sell you more than $10,000 worth of money orders a day. But you shouldn’t need such high limits if you use them for genuine transactions.

Bottom Line: Using debit cards to buy money orders to pay your babysitter or to pay your mortgage or student loans could be worth it to earn miles. But be careful and know that the repeated purchasing of money orders can be suspicious and that you could have your bank account closed.

Tomorrow, we’ll look at other ways to transfer money and earn miles with debit cards, without leaving the house.

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45 responses to “Be Careful When Using Debit Cards to Buy Money Orders to Earn Miles”

Why would someone purchase a money order and then deposit it back into the same account in which they purchased it from (ST/BOA)?!?! That is just asking for trouble — if you want to do this couldn’t you just deposit that money order into another bank account. How could ST/BOA track whether you used that money order to pay for your babysitter or if it went into another account?

I have $6000 left on my car loan and for the longest Ive been trying to figure out how to pay this off by using a credit card/debit card since I already use my credit card for every monthly purchase. I cant do it on chargesmart.com but if my bank accepts money orders should I purchase monthly money orders to may payments on my car? I have a rewards debit card and mileage credit card.

@Matt – Money order purchases AND deposits in large amounts will attract suspicion because they it is easy to convert cash into money orders.

@Unrea - You maybe able to buy a money order to make the monthly card payments on your car.
@Scottrick – The point is that the banks have a great incentive to shut down ANY activity which they feel is suspicious, because the penalties for letting something slip through are very high.

@MMS…I agree but they can’t track the deposits if you deposit the money order in a different bank account. So what proof would ST have if you purchased a MO from (insert store name) and deposited that into any bank account outside ST?

@Kathy K – You’ll get shut down. I tried something similar. Apparantly, Walmart codes these transactions slightly different from merchandise or services rendered, and they found out that this was buying money orders. Account was placed “Under Review” and they want all these forms filled out. Kinda like an AMEX financial review

what institution are you referring to from the Walmart coding?
also, while useful this information is best not talked about, as we all know these blogs are read daily by the banks.
finally, 40M is really not alot of money for many mega banks if the activity is profitable (which this is not)

@Kathy K – If your monthly co-op payment is 25,000 (to earn 25,000 miles) you will attract lots of attention by buying a money order in that amount (and I suspect many places will not sell such a large amount).
@guest @guest2 – This post mentions an additional card and 3 different places to get money orders, so it is a bit different. But if you’re not reading in future, you won’t be upset at future posts!
@Matt – The bank in which you deposit the MOs could get suspicions at repeated high value MO deposits.

@David0603 - Thanks! I’ll fix it.

@Chris M. – Hopefully they really will stop reading, and we’ll have less drama in future!

I am new to this game so I apologize that this may be a stupid question. In the posts above, I clearly know that MO refers to “Money Order”. However, I am not sure what ST means. Can you clarify? A lot of info to absorb but very interesting.

So is this stuff still valid? I see they were from 2012. I’m just learning about all of this, didn’t think about it before. Can you still use debit cards for money orders? Can you use debit cards for paying bills at Walmart? Can you still buy the reload cards with credit cards? Can you load the Amex Blue Bird account using a debit card directly at Walmart? Can you use any debit card? Could you use the prepaid cards to load the BB account? Trying to see how i can get points/miles with the existing card I have. I haven’t applied for new ones yet to get the opening miles offers. Thanks.

@Charles – It still works and you can use debit cards to pay bills at Walmart. You can buy Vanilla Reload cards from CVS with a credit card and then load to your Bluebird. You could use debit cards at Wal-Mart to load your Bluebird as well.

Dear Daraius,
I heard that CVS refuses to allow purchase of Vanilla Reload with credit card, it’s been a few months if I am not mistaken, could you please clarify on that?

Will this work, Say if I buy a pin-enabled gift card or Amex gift card and use them to fill in Bluebird account or just to make money order to a certain individual? This way I can fulfill a minimum spending for a card by paying for something that doesnt accept credit card and having all the legitimate reasons in case I get financial reviewed by Amex. Thanks.

@Jonas Kurniawan – AMEX cards don’t have PINs so you can’t load them to load to a Bluebird. It is getting harder to use gift cards to load Bluebird, so I’d buy a card in a small denomination and test it first.

MMS, I found your post here about Money orders. I plan to purchase a car and they allow only 2k on credit cards. I was thinking to purchase Money orders of 10k at walmart and then pay the dealer. Of course, I may do 2k at a time and make 10k in 5 visits. Do you think this is a little stretch? Walmart does not ask for anything, but would it arouse suspicion to the dealer? Thanks.

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